232 GENERAL FARM PROGRAM 



Mr. Granger. And yet the fellows who are selling beef told us 

 last Monday that they were losing $100 a head on steers. Did they 

 all get out of kelter, or is there any rhyme or reason to it; what is the 

 trouble there? 



Secretary Brannan. The reason they are losing money on their 

 feeding operations now is because they bought them at too high a 

 price. They bought them too high at a time when the net result was 

 that they forced the price of meat up to everybody. 



Mr. Granger. It is in short supply, is it not? 



Secretary Brannan. That is exactly right. I want to make it 

 clear from my example, if I may again, that my proposal is not an 

 income guaranty in any way, shape, or form because the Government 

 is in no wise helping those people with a price-support mechanism 

 actually under the suggestion I have to make. 



Mr. Granger. That is very true, but the public who are buying 

 meat today think that somebody is getting rich out of it when, as a 

 -matter of fact, they are losing their shirts; is not that true? 



Secretary Brannan. That is right. 



Mr. Pace. WiU you yield, Mr.'^Hope? 



Mr. Hope. Yes. 



Mr. Pace. Mr. Secretary, I think the line of questioning by Mr. 

 Hope is to the point, and yet it is not entirely clear to me, and I have 

 just one or two questions. 



When a commodity is in balance as to supply and demand, will you 

 ever use the payment plan? 



Secretary Brannan. When the supply is in balance at the price- 

 support level, no. It may be m balance at a point much higher than 

 that, and again the answer would be no, but if it was an item in balance 

 at a low level, at below the price-support level we might be paying 

 some money. 



Mr. Pace. Now, I think this is very important: assume that the 

 supply and demand is approximately in balance and that the com- 

 modity is bringing in the market place the level of income standard 

 support. 



Secretary Brannan. Yes. 



Mr. Pace. Then do you propose to use the payment plan m cases 

 of that kind? 



Secretary Brannan. We would not be in operation, we would not 

 be operating at all if it were. If the supply and demand were in 

 balance at the support level we would not be operating at all under 

 any program. 



Mr. Pace. I think you would be in operation to the extent that you 

 would have a support price outstanding. 



Secretary Brannan. Well, j^es; there would be a notice on the 

 board to everybody that if it went below that level, then we would 

 come in and start doing business. 



Mr. Pace. Then you would not, for the benefit of the consumer, 

 use any payment plan in cases of that kind? 



Secretary Brannan. That is right, sir. 



Mr. Pace. Either when the supply and demand was in balance or 

 when the supply was short? 



Secretary Brannan. Or when the supply is short because the effect 

 of the short supply would be to keep the price above the standard 

 support level. 



